Both the Premier League and Uefa will have to approve Newcastle United’s possible £25 million shirt deal with Sela, an events company whose website says it is also owned by the club’s main owners, Public Investment Fund [PIF]. This will be the first big test of the competition’s new rules on sponsorship, which were put in place after the takeover.
Newcastle’s Saudi shirt deal tests Premier League sponsorship rules
Senior football executives are even questioning whether the rules cover the case well enough, since the club’s sponsors would end up being owned by the same people.
FairSquare, a human rights group, has told the Premier League that “autocratic states” can “easily hide the source of funding” by making deals like this one. Since Newcastle United made it into the Champions League, Uefa would also have to check the funding.
The club’s contract with gambling company Fun888 ends this summer, and the people in charge at St. James’ Park are currently in talks with Sela. The Premier League has been contacted about these talks.
Even though it is thought that the deal is fair market value given that the team qualified for the Champions League, some leaders in the game are wondering if the new rules still apply since the club is still owned by the same people.
In the controversial 2021 takeover, PIF bought 80% of the club. Under the current Financial Fair Play rules, clubs can only lose up to €30 million over a three-year monitoring period if the owner covers €25 million of that loss through an equity buy.
After the takeover, the other 18 clubs that were not owned by the government brought these worries to the attention of the Premier League. They were afraid that companies in autocratic states like Saudi Arabia could offer better sponsorship deals than they could.
The new rules, which start on page 132 of the Premier League handbook, say that “each Associated Party Transaction must be submitted to the Board (in such form and with such detail as the Board requires) so that the Board can do a Fair Market Value Assessment of it.”
Sela is a company that plans events. Its website says that it is “owned by the Public Investment Fund” and that it is “the first official athlete representation in the Gulf region.”
Dr. Rakan Al-Harthy started the company. He is also a head of Qiddiya, an entertainment project owned by PIF. Crown Prince Mohammed bin Salman is in charge of the Qiddiya board, which Yasir Al-Rumayyan is a member of.
“Dr Rakan Al-Harthy is the founder and CEO of Sela Company,” says the Qidiya website. He is also on the boards of the Event Investment Fund and the Qiddiya Investment Company, among other businesses.